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Mylan NV (NAS:MYL)
Beneish M-Score
-2.41 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Mylan NV has a M-score of -2.41 suggests that the company is not a manipulator.

MYL' s 10-Year Beneish M-Score Range
Min: -4.16   Max: -1.91
Current: -2.41

-4.16
-1.91

During the past 13 years, the highest Beneish M-Score of Mylan NV was -1.91. The lowest was -4.16. And the median was -2.43.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Mylan NV for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 1.1156+0.528 * 0.9629+0.404 * 0.7689+0.892 * 1.1173+0.115 * 0.982
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0418+4.679 * -0.0025-0.327 * 1.0073
=-2.41

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $2,269 Mil.
Revenue was 2082.7 + 2084 + 1837.3 + 1715.6 = $7,720 Mil.
Gross Profit was 969 + 1012.4 + 808.8 + 737.8 = $3,528 Mil.
Total Current Assets was $6,787 Mil.
Total Assets was $15,887 Mil.
Property, Plant and Equipment(Net PPE) was $1,786 Mil.
Depreciation, Depletion and Amortization(DDA) was $567 Mil.
Selling, General & Admin. Expense(SGA) was $1,626 Mil.
Total Current Liabilities was $5,306 Mil.
Long-Term Debt was $5,733 Mil.
Net Income was 189.2 + 499.1 + 125.2 + 115.9 = $929 Mil.
Non Operating Income was -38.1 + 1.5 + -3.7 + -4.6 = $-45 Mil.
Cash Flow from Operations was 126.6 + 440.7 + 179.4 + 268.1 = $1,015 Mil.
Accounts Receivable was $1,820 Mil.
Revenue was 1808.5 + 1767.4 + 1701.7 + 1631.5 = $6,909 Mil.
Gross Profit was 795.9 + 808.5 + 742.4 + 693.5 = $3,040 Mil.
Total Current Assets was $4,471 Mil.
Total Assets was $15,295 Mil.
Property, Plant and Equipment(Net PPE) was $1,666 Mil.
Depreciation, Depletion and Amortization(DDA) was $516 Mil.
Selling, General & Admin. Expense(SGA) was $1,397 Mil.
Total Current Liabilities was $2,964 Mil.
Long-Term Debt was $7,587 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(2268.5 / 7719.6) / (1820 / 6909.1)
=0.29386238 / 0.26342071
=1.1156

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(1012.4 / 6909.1) / (969 / 7719.6)
=0.44004284 / 0.4570185
=0.9629

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (6786.9 + 1785.7) / 15886.6) / (1 - (4471.2 + 1665.5) / 15294.8)
=0.460388 / 0.59877213
=0.7689

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=7719.6 / 6909.1
=1.1173

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(516 / (516 + 1665.5)) / (566.6 / (566.6 + 1785.7))
=0.23653449 / 0.24087064
=0.982

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(1625.7 / 7719.6) / (1396.6 / 6909.1)
=0.21059381 / 0.20213921
=1.0418

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((5732.8 + 5305.7) / 15886.6) / ((7586.5 + 2964) / 15294.8)
=0.69483086 / 0.68980961
=1.0073

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(929.4 - -44.9 - 1014.8) / 15886.6
=-0.0025

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Mylan NV has a M-score of -2.41 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Mylan NV Annual Data

Mar05Mar06Mar07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.70650.81211.12811.04311.06940.87571.09620.98281.15181.1156
GMI 1.1150.99650.95381.2990.98921.00130.97280.97720.97250.9629
AQI 0.83951.1471.86912.18320.99850.99110.98930.95771.07730.7689
SGI 0.91181.0031.28213.18740.99131.07021.12461.10871.01661.1173
DEPI 1.18231.14441.25550.28791.08471.01630.91751.00411.18880.982
SGAI 1.40950.86720.74591.53341.00560.96680.99391.04020.98911.033
LVGI 1.15344.09761.08981.16410.96270.98791.09480.94031.0931.0073
TATA -0.0169-0.1273-0.0642-0.0554-0.0365-0.0479-0.0145-0.0261-0.0267-0.0025
M-score -2.09-4.16-2.04-0.34-2.58-2.75-2.41-2.54-2.44-2.40

Mylan NV Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 1.07020.98280.90151.00631.10841.15181.08471.02620.9251.1156
GMI 0.97290.97720.98480.96820.97220.97250.97110.98020.97140.9629
AQI 1.00270.95770.95060.95250.97311.07731.10621.11660.91230.7689
SGI 1.09471.10871.09251.07521.03321.01661.02181.03951.09111.1173
DEPI 0.99531.00411.00591.02351.12651.18881.19231.18651.08080.982
SGAI 1.0161.04021.01930.96970.99730.98070.98371.05991.04971.0418
LVGI 0.97160.94031.1851.00211.07871.0930.92451.01161.03951.0073
TATA -0.0262-0.0261-0.0456-0.0307-0.0235-0.0267-0.0372-0.0398-0.0249-0.0025
M-score -2.46-2.54-2.79-2.58-2.50-2.44-2.48-2.56-2.65-2.41
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